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Customer Success

Top 3 Customer Success Challenges Facing Tech Executives

How TSIA Advisory Blocks Can Help You Overcome Business Challenges

2 min read
By Steve Carter
Customer success is the fastest growing research practice at TSIA, but it’s not without its challenges. We receive thousands of member inquiries every year on a host of topics from customer success strategy to key performance indicators (KPIs). Successful customer success organizations are able to navigate these challenges and implement best practices to overcome them. But what the specific challenges will be changes each year.  
Here are three of the top customer success business challenges facing organizations today.

Challenge 1: Monetizing Customer Success

As the tech industry becomes less product focused and more service oriented, charging for services will be crucial to your company’s future. Not only will monetizing customer success benefit you, but also your customers. Our data shows that when companies charge for customer success services, customers experience increased revenue expansion rates and improved renewal rates.

Customers are willing to pay for success guidance that adds value, reduces risk, and decreases their time to value.” - Monetizing Customer Success, TSIA Research Report

So with all of these benefits, why does our study show that only 45% of companies charge for their customer success efforts?
“Customer monetization“
Customer Success Monetization Survey

In short, because the transition from free to monetized is a difficult one to make. Customer success managers will need to contend with executives who believe charging for customer success should cover the entire cost of your customer success operation. You’ll also have to figure out how to design your pricing model and how to offer discounts that don’t negatively impact the bottom line.

Challenge 2: Implementing Customer Segmentation

How do you provide the great experience your customers expect while simultaneously growing your team? That’s the challenge facing many customer success organizations, as they seek to scale their business and execute a customer segmentation strategy.
“Customer Segmentation Pyramid”
Customer Segmentation Pyramid

Not all of your customers have the same needs. So to optimize the customer experience, it’s become a common practice to group your customer bases into different segments.

But how do you decide how to segment your customers, which customer success team will cover what segments, and what service level you’ll offer which customers? These are just some of the obstacles that customer success organizations are facing as they try to maintain account coverage and carry out a segmentation strategy.

Challenge 3: Crafting Charters of Customer Success

For some customer success executives, creating a charter is only about checking it off of their to-do list rather than envisioning their organization’s mission. Your charter should be your foundation, not an afterthought.

So what should charters focus on? At TSIA, we believe that adoption is at the heart of customer success’ mission. However, that’s not to downplay the importance of retention or expansion. Expansion as a charter has grown from 47% of customer success organizations having one last year to 61% in our most recent benchmark study.
“Customer Success Charter Types”
Customer Success Charter Survey

Taking the time to create your charters forces you to understand the customer journey and think about how to develop a long-term relationship with them.

But what are the exact mechanics of what a charter should look like and how should it guide your approach? That is a challenge that you yourself might be facing.

Find Solutions with Customer Success Advisory Blocks

One approach to overcoming these business challenges is to ask for outside help, which usually comes in the form of a consultant. However, there are big obstacles to effective consulting, which is why we developed the TSIA Advisory Blocks.
Advisory Blocks were built to help TSIA members apply data, frameworks, and insights to specific situations with short, virtual advisory sessions. Talking with our members, we found that traditional advisory services can be cost prohibitive, broad in scope, time consuming, and have a delayed return on investment (ROI). We constructed our Advisory Blocks to resolve these issues and disrupt the consulting industry.

Here’s what our Advisory Blocks look like and how they can help you.

- Our sessions are hyper-focused on a specific business challenge. This allows you to hone in on the exact problem you need help with and not spend hours getting information you don’t need.
“Customer Success Advisory Blocks”
Customer Success Advisory Blocks

- Advisory Block sessions last 2-4 hours, unlike traditional advisory services that can take days of your time. This allows you to more easily fold them into your schedule and spend more time actually enacting the solution.

- We believe that consulting should empower you to carry out the solution/strategy with tangible data points and next steps. Our Advisory Block sessions are led by industry experts with real-world experience. They lay out exactly what business challenge each session will address and make sure you leave armed with solutions in hand.
“Customer Success Charter Advisory Session”
Customer Success Charter Advisory Session

Customer success is not the only research practice we offer through Advisory Blocks. Our 12 research practices can address other pain points you might be experiencing in everything from professional services to channel optimization. We believe Advisory Blocks are the future of effective problem solving in the tech industry. As the digital transformation continues to terraform the industry landscape, having access to data-driven solutions will be paramount to your success.

 June 9, 2022

Steve Carter

About Author Steve Carter

Steve Carter is the vice president of advisory services for TSIA. In this role, he and his team are responsible for helping TSIA member companies accelerate achievement of their priority business outcomes by leveraging TSIA’s thought leadership, industry insights, frameworks, and best practices in context of the member companies’ desired business objectives.